Norilsk Hires Barclays for International Assets Sale: Sources – by Gillian Tan (Wall Street Journal – October 14, 2013)

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SYDNEY–Russia’s OAO Norilsk Nickel (GMKN.RS), the world’s largest nickel and palladium producer, has hired Barclays PLC (BARC.LN) to sell the majority of its international assets, including mines in South Africa and Botswana, people familiar with the matter said.

The U.K. bank has sent out information to prospective buyers for assets including Norilsk’s 50% stake in the Nkomati joint venture in South Africa. African Rainbow Minerals (ARI.JO) owns the remaining interest and has the right to match any offer for the stake, one of the people said.

The company’s 85% stake in Tati Nickel, which it co-owns with the Botswana government, is also for sale. Both assets were acquired when Norilsk outbid Xstrata PLC to acquire Canada’s LionOre Mining International Ltd. for 6.3 billion Canadian dollars (US$6.1 billion) in 2007.

Another asset on the block is the Norilsk Nickel Harjavalta refinery in Finland, which produces 50,000 metric tons of nickel a year, according to its website.

Norilsk said Oct. 4 that it would divest its international portfolio and focus on its profitable Russian business. At the time, Chief Executive Vladimir Potanin said the company would focus on Tier 1 assets, or those that deliver more than US$1 billion in revenue, a reserve life of more than 20 years, and a profit margin of more than 40%.

Norilsk plans to spend up to US$2.5 billion on three producing projects–Oktyabrsky, Taymyrsky and Komsomolsky–to extend mining by at least four years.

Last month, the miner hired Citigroup Inc. to handle the sale of its Australian assets, which were mostly acquired through the takeover of LionOre Mining.

The price of nickel–used in the manufacture of stainless steel–has fallen around 22% over the past year, due to slowing demand.

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